Business loans for mining services: funding mobilisation, heavy equipment and the wait for a miner to pay

If most of your work comes from mine sites, your loan application is partly about someone else’s business. A lender reviewing a drilling contractor, a shutdown maintenance crew or an equipment hire firm will ask about your own trading, of course. But they’ll also want to know which miner you work for, what it digs up, how long the contract runs and how quickly it pays. In mining services, the client’s health and your own are closely linked.

This page explains how financiers assess contractors and suppliers to mines, the purchases they most often fund and how to put the strongest case forward.

Who counts as mining services?

The sector is broad. It includes drilling contractors (exploration, production, blast hole), earthmoving and haulage contractors, shutdown and maintenance crews, electrical and mechanical contractors, labour hire, camp services, equipment hire, environmental and rehabilitation services, surveying, laboratories and specialist engineering firms.

What they share is a small number of large customers, contracts measured in months or years, heavy equipment and a workforce that often flies in and out. Those four things shape every lending conversation.

Why does the commodity price matter to your loan?

Resources run in cycles, and contractors feel the downturns first. When nickel prices fell, BHP temporarily suspended its Western Australian nickel operations from October 2024, saying it would review the decision by February 2027. Several lithium operations were scaled back or placed on care and maintenance as spodumene prices dropped. Contractors on those sites lost work at short notice, regardless of how well they’d performed.

Lenders who know the sector will ask:

• Which commodity and which site? Established operations in gold, iron ore or bulk commodities tend to be viewed as steadier than projects exposed to a falling price or still in development.
• How long is the contract and how can it be ended? A three-year contract with a termination-for-convenience clause on 30 days’ notice is weaker than it looks.
• How concentrated are you? One client making up most of your revenue is the most common reason a mining services business is offered less than it asked for.
• Where would your gear go next? Equipment that’s easy to redeploy to civil or construction work reduces the lender’s risk, and yours.

Spreading work across two or three clients, sites or commodities is the single most effective way to improve your borrowing position.

The mobilisation gap

Winning a contract is when the cash pressure begins. Before the first claim is approved, you may be paying for:

• recruitment, medicals, inductions and site-specific training
• flights, accommodation and travel time for a fly-in fly-out crew
• transport of equipment to site, sometimes thousands of kilometres
• PPE, consumables, fuel and spares
• wages for the first two pay cycles

Claims are often submitted monthly, approved by the principal, then paid on their payment terms. Add those together and six to ten weeks of costs before cash arrives is common. Our page on winning a big contract and needing to fund it covers how lenders size this kind of request.

Payment terms have improved with some clients. Several large miners and energy companies have signed the Business Council of Australia’s voluntary Australian Supplier Payment Code, which commits signatories to pay eligible small business suppliers within 30 days of a correct invoice. If your client is a signatory and you qualify as a small supplier, it’s worth knowing and quoting. Larger contractors and subcontractors further down the chain don’t always get the same terms.

Just landed a contract and need to mobilise? Start a short enquiry; it won’t affect your credit score.

Funding heavy equipment

Drill rigs, excavators, dump trucks, service trucks, light vehicles, lighting towers and workshop gear make up most of a contractor’s balance sheet. Equipment finance is the usual tool, and a few points are specific to mining:

• Engine hours matter more than age. Lenders and valuers look closely at hours, rebuild history and service records.
• Mine-spec modifications. Fit-outs required for site access (fire suppression, lighting, signage, safety systems) add cost but not always resale value.
• Balloons and residuals. A balloon payment lowers repayments over the contract, but plan for it to fall due as the contract ends. Our balloon payment entry explains the trade-off.
• Unlocking owned gear. Machines you own free and clear can go through a sale and leaseback, turning them into cash for mobilisation without new security.

The equipment finance calculator helps compare terms and balloons on a given machine.

Fuel tax credits and your real costs

Diesel is one of the largest costs for haulage and earthmoving contractors. According to the ATO, fuel used in heavy vehicles off public roads, including on mine sites and private mining roads, is claimed at the rate for other business uses, which is higher than the on-road rate because it isn’t reduced by the road user charge. Keeping good records of where fuel is used, on site or on public roads, makes sure the credits are claimed correctly. Lenders reviewing your BAS will see these credits, and a business that claims them properly tends to show stronger margins.

Documents to prepare

1. Accounts and tax returns for the last two years, with this year’s figures to date
2. Business bank statements (six months at minimum) and your recent BAS
3. Current contracts, including term, rates, payment terms and termination clauses
4. A schedule of work in hand and tenders submitted
5. An equipment register with engine hours, age and existing finance
6. Aged debtors, showing approved and pending claims
7. Safety and compliance records your clients require

Example: a drilling contractor adding a rig

An illustrative example. A drilling contractor based in Kalgoorlie runs five rigs on gold exploration and grade control programs for three clients, turning over about $9m. It’s offered a two-year contract on a new site that needs a sixth rig, a support truck and a crew of eight.

The used rig and truck cost about $1.3m. Mobilisation (recruitment, inductions, flights, transport of gear and the first two pay runs) adds about $280k before the first claim is paid on 30 day terms. The bank is willing to lend on the rig but would take several weeks and wants additional property security. The owners finance the rig and truck with a non-bank equipment lender, secured on the equipment, and set up an invoice finance facility over approved claims across all three clients. A short-term loan covers mobilisation and is repaid from the first two months of claims. Because the new client is the fourth on the books, no single site carries the business.

For contractors whose work also takes them into civil projects, see civil contractors and earthmoving contractors.

Let’s talk about your next contract

Mining services finance is about timing: the gear before the job, the crew before the first claim and the cash buffer that sees you through a site closing early.

It takes about a minute to send us your details, and that first step doesn’t involve any credit check. Your enquiry isn’t sold on or passed around. One of our people reads it, works through your contracts, gear and clients, and then phones you. Fill it in carefully, particularly turnover, contracts and existing finance, so the first match we suggest is a solid one.

Discuss funding for your mining services business →